Will US-Iran tensions raise supply risks and spark Brent crude price rally? Resistance levels in focus

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Brent crude gains 1.36% to $77.08

Highlights

Brent crude prices are supported by increased shipment risks and higher war insurance costs amid heightened US-Iran tensions in the Strait of Hormuz.
Recent US strikes on Iran have added uncertainty to de-escalation prospects, sustaining concerns over potential supply disruptions in the region.
Technicals show short-term bullish bias with conflicting momentum signals; Brent is expected to trade between $74.94 and $79.22, with upside probability at 67%.

Geopolitical risk and shipping concerns fuel bullish sentiment

The market remains optimistic on Brent crude as constrained traffic through the Strait of Hormuz and rising war insurance costs, due to escalating US-Iran tensions, have heightened shipment risks and supported near-term supply concerns, according to Fxstreet. This environment is further complicated by recent US strikes on Iran, which have introduced uncertainty over progress toward de-escalation and the potential reopening of the strait, as noted by Marketscreener. Ongoing logistical and geopolitical challenges in the region have become key drivers of current price sentiment.

Resistance holds amid overbought signals and mixed momentum

On the H1 chart, XBR trades above the MA-20 but remains below the MA-50 and the longer-term MA-200. The daily Ichimoku Kijun sits at $77.31, acting as immediate resistance. Among technical indicators, the Moving Average Convergence Divergence (MACD) suggests strong selling conditions, while the Average Directional Index (ADX) signals weak directional conviction. Both the Stochastic RSI and Commodity Channel Index (CCI) position XBR as overbought, the Relative Strength Index (RSI) reads 53.19 in mild buy territory, and Bull/Bear Power is overbought as well. The Awesome Oscillator is neutral, pointing to a divergence between intraday trends and momentum signals.

Upside favored as volatility defines short-term trading range

For the next two to three trading days, XBR is expected to fluctuate between $74.94 and $79.22, reflecting typical volatility at current price levels. The probability leans toward an upside scenario at 67%, while the downside scenario has a 33% chance. Price action within the established corridor is most likely, but a break above short-term resistance could open the way for further gains, while a drop below support would be needed to trigger a sustained reversal.

Anton Kharitonov, expert at Traders Union, sees the Brent crude market facing persistent supply concerns as Strait of Hormuz risks keep sentiment cautious. He believes technical signals are mixed, with price action overbought and resilience lacking beyond immediate resistance. Downside cannot be ruled out with upside constrained by macro and momentum headwinds. "Until Brent clears $77.31 with conviction, I remain wary of chasing further gains amid fragile sentiment."

Previously it was reported that UAE's record crude output highlighted the Gulf region's shifting oil dynamics and heightened sensitivity to geopolitical disruptions around the Strait of Hormuz. With ongoing war risks and rising insurance costs now fueling upside bias in Brent, traders should monitor for a potential breakout above immediate resistance levels, which could trigger further momentum and recalibrate short-term positioning.

Source of Data: XBR Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.